About 90% of those hired under a mandatory local hiring quota at state-run financial institutions graduated from just three universities in the region, according to data reviewed by a lawmaker. Critics say a program designed to keep regional talent from leaving for the Seoul metropolitan area has effectively become a pipeline for graduates of a handful of schools.
Of the 244 college graduates the Korea Asset Management Corporation, based in Busan, hired under the quota between 2018 and the end of July this year, 219, or 89.8%, came from Pusan National University, Pukyong National University or Dong-A University, according to the office of Rep. Cho Jung-hoon of the People Power Party, a member of the National Assembly's National Policy Committee, on the 3rd. At the Korea Housing Finance Corporation, also headquartered in Busan, 103.5 of the 111.5 college graduates hired as local talent, or 92.8%, were graduates of those same three schools.
The concentration was also striking at the Korea Credit Guarantee Fund, located in the Daegu innovation city district. Of the 279 people it hired as local talent over the past nine years, 216, or 77.4%, came from Kyungpook National University or Yeungnam University.
Since 2018, the government has required public institutions that have relocated to provincial areas to hire a minimum share of graduates from universities and high schools in those regions. The required share started at 18% in 2018 and rose by three percentage points a year, reaching 30% in 2022.
Nine years into the program, the share of employees from particular universities has risen sharply. At the Korea Housing Finance Corporation, graduates of five Busan-area universities — Pusan National University, Dong-A University, Pukyong National University, Korea Maritime and Ocean University and Busan University of Foreign Studies — accounted for 18.1% of staff as of the end of July, up about seven percentage points from 11.3% at the end of 2018. At the Korea Asset Management Corporation, 10.3%, or 158 people, of all current employees at grade five and above graduated from Pusan National University, while at the Korea Credit Guarantee Fund 9.4%, or 208 people, came from Kyungpook National University.
Some warn that a heavy concentration of graduates from a few schools among new hires could erode an organization's dynamism and diversity. There is particular concern that once those employees reach management ranks, decisions will be made by a small circle, creating factions built on school ties. Many also argue that the relocation of state-run financial institutions to provincial areas risks degenerating into a carve-up of jobs. An official at one public institution that moved its headquarters to the Yeongnam region said, "There are now so many people from certain universities relative to the total headcount that a cartel has already formed internally."
Experts say the geographic areas used to select local talent need to be widened. The current system divides the country into eight zones: Busan; Ulsan and South Gyeongsang; Daegu and North Gyeongsang; Gwangju and South Jeolla; North Jeolla; Chungcheong; Gangwon; and Jeju. Some also argue that applicants should qualify as local talent if they attended elementary, middle and high school in the region, even if they went to university in the Seoul metropolitan area. Cho said, "We need to examine how the program is being run and whether the local hiring system could end up weakening these institutions' competitiveness."
